India-US trade deal can put ties on better track, says Jaishankar
External Affairs Minister S Jaishankar said a trade agreement between India and the US, if concluded, would help put the bilateral relationship on a "better" track. He said expectations that the negotiations could move quickly had been tested by a far more complex ground reality.
Speaking at a special conversation hosted by the Asia Society in New York as the high-level week of the 81st session of the UN General Assembly concluded, Jaishankar said the two sides had reached a stage where there was "more or less an understanding on the trade agreement". At the same time, he said changes on the American side, including the new Section 301 process, had raised questions about when the deal should be closed.
During a conversation moderated by former American diplomat and Asia Society Policy Institute distinguished fellow Daniel Russel, Jaishankar was asked about India-US relations, especially trade and tariffs over the past year, and what would be needed to put ties on a "better track". "Well, I think if I stand back and look at the relationship,... I note that much of the world has had a more difficult relationship with the US. I mean that may not be a consolation, but that's a reality," he said. He added that one of the issues affecting ties was the trade negotiation. Pointing to the "stakes" and "complexity" involved, he said, "Bear in mind, India is a society of small producers, small agriculture producers, small factories. Apart from the per capita gap between India and the United States, the nature of production, nature of society is very different."
Jaishankar said, "A trade negotiation required a certain amount of ... patience and detailing to see it through The expectation that it could rapidly move forward, I think, was tested against a ground reality which was much more complex." Referring to remarks by Commerce and Industry Minister Piyush Goyal, he said the issue now was what had changed on the American side and how the new Section 301 process would affect the agreement. "The 301 process is still in the works, it's still unfolding. So the issue for us is at what point do you close out an agreement which is very, very far advanced," he said. "But the period that it took to reach it, that did create bumps last year for the relationship. So presumably, if that agreement is closed out, that would be one point which would contribute to a better relationship," he added.
India and the US had in February announced the finalisation of the framework for the first phase of the bilateral trade agreement. However, changes in the US tariff landscape led to further negotiations on the pact. The US Supreme Court had earlier struck down President Donald Trump's reciprocal tariffs imposed under emergency powers, after which Washington adopted a different tariff framework. In July, the US imposed an additional 10 per cent tariff on imports from India under Section 301 of the Trade Act after a probe into India's measures concerning goods produced with 'forced labour'. The two sides have continued negotiations amid these changes. Last week, Goyal said the trade pact was "done and dusted" and would be executed once the US gives India the right competitive advantage over its competitors in the American market. He is due to visit the US from September 29 to October 5 to attend a G20 meeting in Milwaukee and hold talks with US Trade Representative Jamieson Greer on advancing the negotiations.
Jaishankar also said India-US ties were shaped to some extent by developments within the US. "For many years mobility was seen as an economic gain. Now, today the economics of mobility and the politics of mobility are at odds with each other," he said. He added that in the social media era, foreign policy was no longer shaped only by states, leaders, ministers or diplomats, and that public opinion had become a major factor, especially in democracies. Summing up, he said India would "certainly hope for and expect the relationship to move on an upward trajectory", but added that progress on unresolved issues would be important for building a better relationship.
